Friday, August 16, 2024 The Tourism Export Council of New Zealand (TECNZ) voices industry worries that the recent rise in visitor visa fees by Immigration NZ may hinder New Zealand’s efforts to recover its international tourism sector. Chief Executive Lynda Keene said, “The Tourism Export Council of New Zealand was asked for feedback on the proposed increase in fees earlier this year. TECNZ’s submission requested Immigration NZ review the increase in fees and levies and reduce by 50%.
We appreciate the proposed increase for group tour fees has been reduced. However, the standard visitor visa fee and working holiday visa fee increases might just be high enough to take New Zealand off the must-visit destination list. We, alongside Tourism Industry Aotearoa (TIA), have raised concerns that increasing visitor visa fees during the ongoing tourism recovery is ill-timed.
The inbound sector and airlines plan their tickets and itineraries one to two years ahead, making it crucial to provide adequate notice so potential visitors can make informed decisions and secure travel plans to New Zealand. While we understand the need for some cost recovery for visa services, the current timing for full recovery is detrimental to growth in offshore markets. We would have preferred to see fee increases postponed until October 1, 2025.
The fee hike is expected to affect high-growth markets like India and the recovery of New Zealand’s second-largest visitor market, China. Both markets have significant potential to influence our international tourism rebound, but their sensitivity to price changes could be detrimental. TECNZ’s April 2024 forecast projected that by the end of March 2025, international arrivals would reach 88% of pre-Covid levels, with a full recovery by March 2026.
However, our latest forecast (August 2024) has adjusted expectations based on lower-than-expected airline bookings and a softening in several markets. While the US, Australia, India, and Canada have shown strong performance, we are seeing a slight decline for the 2024-2025 season. Specifically, the holiday segment remains at 75% of pre-Covid arrivals, indicating that further efforts are needed to improve this figure.
We now anticipate that by the end of May 2025, the recovery will reach 85%, with 96% by May 2026, and a full return to pre-Covid levels by May 2027. We are also aware that the International Tourism Conservation & Visitor Levy (IVL) is under review. Given the simultaneous increases in border, customs, and immigration fees in 2024, we urge the Government to postpone the IVL review until we achieve pre-Covid arrival numbers.
If an increase is necessary, we recommend implementing it in 2025 or 2026. New Zealand must remain proactive and not assume that visitors will come regardless. We need to offer an attractive and affordable proposition to encourage tourists to choose New Zealand.
In a highly competitive global market, maintaining competitive pricing and compelling travel options is essential for keeping New Zealand on travelers’ itineraries..
